By Cain S.B. No. 629
76R5404 MLS-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to contract claims against a unit of state government.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Title 5, Civil Practice and Remedies Code, is
1-5 amended by adding Chapter 111 to read as follows:
1-6 CHAPTER 111. CONTRACT CLAIMS AGAINST THE STATE
1-7 Sec. 111.001. DEFINITIONS. In this chapter:
1-8 (1) "Contract" means a contract between a unit of
1-9 state government and a contractor for a project as that term is
1-10 defined by Section 2166.001(4), Government Code.
1-11 (2) "Contractor" means a person that is a party to a
1-12 written contract with a unit of state government for a project.
1-13 (3) "Unit of state government" means the state or an
1-14 agency, department, commission, bureau, board, office, council,
1-15 court, or other entity that is in any branch of state government
1-16 and that is created by the constitution or a statute of this state,
1-17 including a university system or institution of higher education as
1-18 defined by Section 61.003, Education Code. The term does not
1-19 include a county, municipality, court of a county or municipality,
1-20 special purpose district, or other political subdivision of this
1-21 state.
1-22 Sec. 111.002. CLAIM FOR BREACH OF CONTRACT. (a) A
1-23 contractor may make a claim against a unit of state government for
1-24 breach of a contract. A contractor must assert a claim arising
2-1 from a contract not later than the 90th day after the date the
2-2 contract is completed.
2-3 (b) A claim may be made by filing a petition with the chief
2-4 administrative officer of the unit of state government or the
2-5 officer of the unit designated in the contract. The petition must
2-6 contain a concise statement of the facts relied on by the
2-7 contractor, a statement that the claim is made subject to this
2-8 chapter, a statement of the relief or remedy desired, and a copy of
2-9 the contract and other contract documents that relate to the claim.
2-10 (c) The chief administrative officer or the officer
2-11 designated in the contract shall examine the claim and negotiate in
2-12 good faith with the contractor in an effort to resolve the claim.
2-13 Sec. 111.003. MEDIATION. (a) If a claim submitted under
2-14 Section 111.002 is unresolved after the 30th day after the date the
2-15 unit of state government receives the claim, the parties shall
2-16 proceed to mediation with an independent mediator selected by the
2-17 parties.
2-18 (b) The mediation shall be completed not later than the 60th
2-19 day after the date the claim was received by the unit of state
2-20 government unless the contractor and the unit of state government
2-21 agree to extend the mediation period. The mediation period may not
2-22 exceed the 90th day after the date the claim was received.
2-23 (c) A contract may include additional terms relating to the
2-24 mediation. The contract may not require the contractor to waive any
2-25 remedy the contractor may have under this chapter.
2-26 (d) The costs of the mediation shall be shared equally by
2-27 the contractor and the unit of state government.
3-1 (e) If the mediation does not produce agreement as to the
3-2 claim, the chief administrative officer or the officer of the unit
3-3 of state government designated in the contract shall respond to the
3-4 claim, providing the factual and legal basis for the position of
3-5 the unit of state government regarding the claim not later than the
3-6 30th day after the date the mediation ends.
3-7 Sec. 111.004. CONTESTED CASE HEARING. (a) If the
3-8 contractor is not satisfied with the unit of state government's
3-9 response to the claim, the contractor may file an appeal with the
3-10 unit of state government. The appeal must state the factual and
3-11 legal basis for the claim and request that the claim be referred to
3-12 the State Office of Administrative Hearings for a contested case
3-13 hearing.
3-14 (b) The unit of state government shall refer the claim to
3-15 the State Office of Administrative Hearings for a contested case
3-16 hearing under Chapters 2001 and 2003, Government Code, as to the
3-17 issues raised in the appeal.
3-18 (c) If the settlement decision issued by the administrative
3-19 law judge at the State Office of Administrative Hearings makes an
3-20 award of some portion of the claim in an amount of $500,000 or
3-21 less, the agency shall pay the claim not later than the 30th day
3-22 after the date the decision is issued.
3-23 (d) If the settlement decision makes an award of the claim
3-24 that is more than $500,000, the proposal for decision shall be sent
3-25 to the lieutenant governor and the speaker of the house of
3-26 representatives as a recommendation for an appropriation to pay the
3-27 amount of the award in the next appropriation to the unit of state
4-1 government.
4-2 Sec. 111.005. AWARDS. (a) An award based on a claim made
4-3 under this chapter may not exceed the total value of consideration
4-4 the contractor was to receive under the contract.
4-5 (b) An award may not be made for exemplary or punitive
4-6 damages.
4-7 (c) Chapter 304, Finance Code, applies to an award under
4-8 this chapter.
4-9 Sec. 111.006. EXCLUSION. This chapter does not apply to a
4-10 claim against the Texas Department of Transportation.
4-11 SECTION 2. This Act takes effect September 1, 1999.
4-12 SECTION 3. (a) This Act applies only to a suit based on a
4-13 contract entered into by a unit of state government on or after the
4-14 effective date of this Act. A suit based on a contract entered
4-15 into before the effective date of this Act is governed by the law
4-16 as it existed immediately before the effective date of this Act,
4-17 and that law is continued in effect for that purpose.
4-18 (b) For purposes of this section, a contract is entered into
4-19 after the effective date of this Act if it is executed or renewed
4-20 after the effective date of this Act.
4-21 SECTION 4. The importance of this legislation and the
4-22 crowded condition of the calendars in both houses create an
4-23 emergency and an imperative public necessity that the
4-24 constitutional rule requiring bills to be read on three several
4-25 days in each house be suspended, and this rule is hereby suspended.